Northlich, Bridge Call Off Deal

Northlich has put its pending acquisition of Bridge Communications on hold because of the staggering economy.

The deal between the two Cincinnati shops would have created a single agency with nearly $200 million in billings and $30 million in annual revenue, making it by far the market’s largest. The agencies had signed a letter of intent on the deal in February [Adweek, Feb. 12].

“But there is a softness in our industry right now,” said Northlich president and CEO Mark Serrianne. “We even see our clients being much more cautious about spending.”

Bridge president and CEO Peter Schwartz said the “timing just wasn’t right in this generally volatile market” for the deal to proceed.

The business downturn has led to caution throughout the ad industry. Late last month Bcom3 said it was putting off its plans to go public because of the bearish market [Adweek, April 2].

Serrianne wouldn’t rule out the possibility that Northlich and Bridge will revisit the deal under different financial conditions.

Northlich and Bridge in some ways were a natural combination. Each has business from local marketing heavyweight Procter & Gamble, as well as Cincinnati Bell and Harris Corp.

Serrianne said the decision also is not a reflection on the business climate in Cincinnati. “We have national clients, and we are seeing the effects (of the economic downturn) coast to coast,” he said.

Bridge is a full-service agency that specializes in interactive services, which Northlich found attractive for its operations. “We hold nothing against Bridge,” Serrianne said.

When the deal was first announced, Northlich said the acquisition would be the first step in the agency’s four-year plan to grow by acquisitions and strategic alliances. Those plans have not changed, although the agency currently has no other acquisition deals pending, Serrianne said.

Northlich began its expansion process in December 1999, when the shop, celebrating it’s 50th anniversary, changed its name from Northlich Stolley LaWarre.

Bridge’s clients include Dirt Devil, NCR and Thomson Consumer Electronics.